exv10w87



 





Exhibit 10.87




CATALYST SEMICONDUCTOR, INC.



Severance Agreement




     This Severance Agreement (“Agreement”) is made as of the 14th day of
October, 2002 between George Smarandoiu (“Employee”) and Catalyst
Semiconductor, Inc. (‘“Corporation”).



WITNESSETH




     WHEREAS, Employee is employed by the Corporation.



     WHEREAS, the Corporation and Employee mutually desire to enter into a
severance agreement with respect to Employee’s employment by the Corporation.



     NOW, THEREFORE, in consideration of the mutual convents hereinafter
contained, the Corporation and Employee agree as follows:



     1) INVOLUNTARY TERMINATION. If Employee’s employment is
terminated as a result of Involuntary Termination other than for cause, at any
time prior to three years from this date, Employee will be entitled to
consideration as defined below:



     2) SEVERANCE BENEFITS FOR INVOLUNTARY TERMINATION
FOLLOWING A CHANGE OF CONTROL.



a) Employee shall be entitled to fifty percent (50%) of
his annual base salary payable in six equal monthly installments, commencing
one month after the termination date.



b) All outstanding unvested stock options shall
immediately vest as of the date of termination and shall remain exercisable for
a period of three years after said date.



c) In addition, as of the termination date, Employee
shall be entitled to receive any unpaid salary and accrued vacation,



d) Change of control is defined as any sale of
substantially all of the Company’s assets, a sale of a majority of its shares
or a merger or consolidation where the existing shareholders do not control at
least 50% of the total voting power after the event.



     3) SEVERANCE BENEFITS FOR INVOLUNTARY TERMINATION APART
FROM A CHANGE OF CONTROL.



a) Employee will be entitled to twenty-five percent (25%)
of his annual base salary as of the termination date. Such payment shall be
paid in six equal monthly amounts commencing one month after the termination
date.



b) All outstanding vested options as of this date shall
remain exercisable for a period of one year after termination date.



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c) In addition, as of the termination date, Employee shall be entitled to receive any unpaid salary and accrued vacation pay.



     4) No severance payment will be made under paragraphs 2
or 3 if termination occurs, for any reason, during the first ninety (90) days
of employment.



     5) CONFIDENTIAL INFORMATION. Employee shall continue to
maintain the confidentiality of all confidential and proprietary information of
the Corporation and shall continue to comply with the terms and conditions of
the Confidentiality Agreement(s) between Employee and Corporation.



     6) NON-DISPARGEMENT. Employee agrees not to disparage
the Corporation or any of its officers, directors, employees, products, vendors
or customers.



     7) RELEASE OF CLAIMS. Both parties agree that the
foregoing consideration represents settlement in full of all outstanding
obligations owed by Corporation to the Employee. Employee and his respective
heirs, executors, assigns and agents hereby fully and forever releases
Corporation and its officers, directors, employees, assigns and agents from any
claim, duty, obligation or cause of action relating to any matters, known or
unknown, arising from any omissions, acts or facts that have occurred up until
the termination date, including without limitation:



a) Any claims relating to Employee’s employment
relationship with the Corporation.



b) Any claims relating to Employee’s receipt of options
and/or purchase or sales of shares of stock of the Corporation.



c) Any claims for violation of state, federal or
municipal law.



     8) CONFIDENTIALITY. The parties agree to use their best
efforts to maintain in confidence the existence, contents and terms of this
Agreement, except as disclosure may be required by law.



     9) TAX CONSEQUENCES. The Corporation makes no
representations or warranties with respect to the tax consequences of any
consideration received by Employee under the terms of this Agreement. Employee
agrees that he is solely responsible for payment, if any, of local, state or
federal taxes on all consideration received. Employee further agrees to
indemnify the Corporation for any claims due to his failure to pay any such
taxes.



     10) ENTIRE AGREEMENT. This Agreement represents the entire
agreement and understanding between the Corporation and Employee concerning
Employee’s relationships with the Corporation and supersedes any prior written
or oral agreements concerning Employee relationship with and compensation from
the Corporation and may not be changed except in written form signed’ by both
parties.



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     11) GOVERNING LAW: JURISDICTION. This Agreement, shall be
governed by the laws of the State of California. Any disputes shall be
resolved by binding arbitration by JAMSENDISPUTE in Santa Clara County, to
which binding arbitration both parties consent.



     12) NO LEGAL REPRESENTATION. Employee is advised to seek his
own legal advice in this matter and acknowledges that Orrick, Herrington &
Sutcliffe LLP are acting solely as counsel for the Corporation and not for
Employee.



IN WITNESS WHEREOF, the parties have executed this Agreement, as of the date
first written above.



Catalyst Semiconductor, Inc.




	 	 	 
	By: /s/ Gelu Voicu

Gelu Voicu

Executive Vice President and COO	 	
/s/ George Smarandoiu



George Smarandoiu

Vice President of Design








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